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The College Football Association Television Broadcase Cartel

  • John J. Siegfried


    (Department of Economics, Vanderbilt University; American Economics Association)

  • Molly Gardner Burba

    (Private Investment Banking Company LLC, New York)

The College Football Association (CFA) sold rights to broadcast live games of its members from 1984 through 1995. It competed directly with the Big Ten and Pac Ten universities that sold an alternative broadcast package. Each of the duopolists dominated certain geographic areas, so that they retained much of the monopoly power of the single NCAA cartel that they replaced. The CFA restricted output in order to elevate rights fees, and limited entry into the Association. The broadcast rights fees it collected substantially exceeded marginal cost. This article examines how the number of sellers, entry conditions, product homogeneity, and the elasticity of demand fostered the cartel, and how the cartel prevented cheating on the agreement. Eventually, disputes over the distribution of the rents led to defections. Penn State and Notre Dame left in 1990 and 1991. When the Southeastern Conference struck out independently after 1995, the CFA collapsed. It sealed its books on June 30, 1997.

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Paper provided by Vanderbilt University Department of Economics in its series Vanderbilt University Department of Economics Working Papers with number 0320.

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Date of creation: Sep 2003
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Handle: RePEc:van:wpaper:0320
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